Gold, Silver Fall Awaiting Fed Beige Book

The first Q1 earnings report is strong, and European bonds steady

Gold and silver were lower Wednesday morning as Alcoa (NYSE:AA) posted better-than-expected Q1 earnings and European government bonds steadied and even recovered somewhat in price.

Spot gold was slightly lower, down 0.11% bid at $1,658.80 as of 10:45 a.m., having traded as high as $1664 and as low as $1655.30 an ounce, according to Kitco market data. The London afternoon reference price was set at $1,658, $14 an ounce higher than Tuesday’s afternoon reference price.

Spot silver was showing a 0.53% loss, bid at $31.67, with an ask price of $31.77. The morning high as of time of writing was $31.95 and the low was $31.48. Wednesday’s reference price was set at $31.70 in the London a.m., 15 cents an ounce higher than Tuesday’s price fix.

Alcoa, the first DJIA member to post Q1 earnings results, lifted stock market spirits by announcing it had moved from net loss to net profit during 2012′s first quarter.

In Europe, Spanish and Italian government bond yields declined having risen sharply Monday and Tuesday. Germany’s Treasury sold less than the full allotment of new benchmark 10-year German bunds at auction, though the 4.11 billion euros’ worth that were sold were taken up at a record low 1.77% yield.

Markets will be Fed-watching later today as the first Federal Reserve Beige Book of 2012 is due to be released.

“If weak [economic] data continue, the Fed will have to intervene again to stimulate consumption,” commented Jeremy Friesen, Hong Kong-based commodity strategist at Société Générale. “The next couple of years will be really challenging for global growth, and central banks will be relied on as a crutch to get us through.”

Gold and silver trusts continued to move lower on U.S. stock exchanges Wednesday morning.

The SPDR Gold Trust (NYSE:GLD) was down around 0.05%.
The iShares Gold Trust (NYSE:IAU) was down around 0.05%.
The iShares Silver Trust (NYSE:SLV) was down around 0.65%.

Gold mining ETFs were flat to lower while the Global X Silver Miners ETF was higher.

Agnico-Eagle Mines (NYSE:AEM) was showing losses of around 1.5%.Barrick Gold (NYSE:ABX) was down around 0.5%.Eldorado Gold (NYSE:EGO) was up nearly 0.7%.Goldcorp (NYSE:GG) was showing losses of around 0.65%.Kinross Gold Corp. USA (NYSE:KGC) was down around 1.8%.Newmont Mining (NYSE:NEM) was down more than 1.8%.NovaGold Resources (NYSEAMEX:NG) was down nearly 1.5%.Yamana Gold (USA) (NYSE:AUY) was down some 0.65%.

Silver mining shares were mixed.

Coeur d’Alene Mines (NYSE:CDE) was showing gains of more than 0.5%.Hecla Mining (NYSE:HL) was down some 1.15%.Pan American Silver (NASDAQ:PAAS) was showing losses of around 0.15%.Silver Wheaton (NYSE:SLW) was down nearly 0.5%.Silver Standard Resources (NASDAQ:SSRI) was up some 0.35%.

As of this writing, Andrew Burger did not hold a position in any of the aforementioned securities. Adrian Ash of BullionVault contributed to this report.